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Bureau of Customs andBorder Protection

General Notices

AGENCY INFORMATION COLLECTION ACTIVITIES:Protest

AGENCY: Customs and Border Protection, Department of Home-land Security.

ACTION: Proposed collection; comments requested.

SUMMARY: Customs and Border Protection (CBP) of the Depart-ment of Homeland Security has submitted the following informationcollection request to the Office of Management and Budget (OMB)for review and approval in accordance with the Paperwork Reduc-tion Act of 1995: Protest. This is a proposed extension of an informa-tion collection that was previously approved. CBP is proposing thatthis information collection be extended without a change to the bur-den hours. This document is published to obtain comments form thepublic and affected agencies. This proposed information collectionwas previously published in the Federal Register (71 FR 19197) onApril 13, 2006, allowing for a 60-day comment period. This notice al-lows for an additional 30 days for public comments. This process isconducted in accordance with 5 CFR 1320.10.

DATES: Written comments should be received on or before July 31,2006.

ADDRESSES: Written comments and/or suggestions regarding theitems contained in this notice, especially the estimated public bur-den and associated response time, should be directed to the Office ofManagement and Budget Desk Officer at [email protected].

SUPPLEMENTARY INFORMATION:

The Bureau of Customs and Border Protection (CBP) encouragesthe general public and affected Federal agencies to submit writtencomments and suggestions on proposed and/or continuing informa-tion collection requests pursuant to the Paperwork Reduction Act of

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1995 (Pub. L.104–13). Your comments should address one of the fol-lowing four points:

(1) Evaluate whether the proposed collection of information isnecessary for the Proper performance of the functions of theagency/component, including whether the information willhave practical utility;

(2) Evaluate the accuracy of the agencies/components estimate ofthe burden of The proposed collection of information, includingthe validity of the methodology and assumptions used;

(3) Enhance the quality, utility, and clarity of the information tobe collected; and

(4) Minimize the burden of the collections of information on thosewho are to respond, including the use of appropriate auto-mated, electronic, mechanical, or other technological collectiontechniques or other forms of information technology, e.g., per-mitting electronic submission of responses.

Title: ProtestOMB Number: 1651–0017Form Number: CBP Form 19Abstract: This collection is used by an importer, filer, or any

party at interest to petition CBP, or Protest any action or charge,made by the port director on or against any; imported merchandise,merchandise excluded from entry, or merchandise entered into orwithdrawn from a bonded warehouse.

Current Actions: This submission is to extend the expirationdate without a change to the burden hours.

Type of Review: Extension (without change)Affected Public: BusinessEstimated Number of Respondents: 3,750Estimated Time Per Respondent: 6 hoursEstimated Total Annual Burden Hours: 67,995Estimated Total Annualized Cost on the Public: N/AIf additional information is required contact: Tracey Denning, Bu-

reau of Customs and Border Protection, 1300 Pennsylvania AvenueNW, Room 3.2.C, Washington, D.C. 20229, at 202–344–1429.

Dated: June 15, 2006

TRACEY DENNING,Agency Clearance Officer,Information Services Branch.

[Published in the Federal Register, June 30, 2006 (71 FR 37596)]

2 CUSTOMS BULLETIN AND DECISIONS, VOL. 40, NO. 29, JULY 12, 2006

Modification of the CBP NCAP Test RegardingReconciliation for Entries Under the Dominican

Republic-Central America-United States Free TradeAgreement

AGENCY: Customs and Border Protection, Homeland Security.

ACTION: General notice.

SUMMARY: This document announces a modification to the Cus-toms and Border Protection Automated Commercial System (ACS)Reconciliation prototype test that adds to the issues subject to theReconciliation process those arising under the Dominican Republic-Central America-United States Free Trade Agreement. Other thanthis modification, the test remains the same as set forth in previ-ously published Federal Register notices.

DATES: The test modification set forth in this document is effectiveon September 28, 2006. The two-year testing period of this Reconcili-ation prototype commenced on October 1, 1998, and was extendedindefinitely starting October 1, 2000. Applications to participate inthe test will be accepted throughout the duration of the test.

ADDRESSES: Written inquiries regarding participation in the Rec-onciliation prototype test and/or applications to participate should beaddressed to Ms. Monica Crockett, Reconciliation Team, Bureau ofCustoms and Border Protection, 1300 Pennsylvania Ave. NW, Room5.2A, Washington, D.C. 20229–0001. Answers to inquiries regardingthe test are also available at [email protected].

FOR FURTHER INFORMATION CONTACT: Ms. Monica Crock-ett at (202) 344–2511.


Background

Reconciliation, a planned component of the National Customs Au-tomation Program (NCAP), as provided for in Title VI (Subtitle B) ofthe North American Free Trade Agreement Implementation Act (theNAFTA Implementation Act; Pub. L. 103–182, 107 Stat. 2057 (De-cember 8, 1993)), is currently being tested by the Bureau of Customsand Border Protection (CBP) under the CBP Automated CommercialSystem (ACS) Prototype Test. CBP announced and explained thetest in a general notice document published in the Federal Regis-ter (63 FR 6257) on February 6, 1998. Clarifications and operationalchanges were announced in subsequent Federal Register notices:63 FR 44303, published on August 18, 1998; 64 FR 39187, published

BUREAU OF CUSTOMS AND BORDER PROTECTION 3

on July 21, 1999; 64 FR 73121, published on December 29, 1999; 66FR 14619, published on March 13, 2001; 67 FR 61200, published onSeptember 27, 2002 (with a correction document published at 67 FR68238 on November 8, 2002); 69 FR 53730, published on September2, 2004; 70 FR 1730, published on January 10, 2005; and 70 FR46882, published on August 11, 2005. A Federal Register (65 FR55326) notice published on September 13, 2000, extended the proto-type indefinitely. This document announces a modification to theReconciliation test to expand the issues subject to Reconciliation toinclude those arising under the Dominican Republic-CentralAmerica-United States Free Trade Agreement. Aside from this modi-fication, the test remains as set forth in the previously publishedFederal Register notices.

For application requirements, see the Federal Register no-tices published on February 6, 1998, and August 18, 1998. Addi-tional information regarding the test can be found at http://www.customs.gov/xp/cgov/import/cargo_summary/reconciliation/.

Reconciliation Generally

Reconciliation is the process that allows an importer, at the timean entry summary is filed, to identify undeterminable information(other than that affecting admissibility) to CBP and to provide thatoutstanding information at a later date. The importer identifies theoutstanding information by means of an electronic ‘‘flag’’ which isplaced on the entry summary at the time the entry summary is filedand payment (applicable duty, taxes, and fees) is made. Previouslypublished Federal Register documents have set forth that the is-sues for which an entry summary may be ‘‘flagged’’ (for the purposeof later reconciliation) are limited and relate to: (1) value issuesother than claims based on latent manufacturing defects; (2) classifi-cation issues, on a limited basis; (3) issues concerning value aspectsof entries filed under heading 9802, Harmonized Tariff Schedule ofthe United States (HTSUS) (9802 issues); and (4) issues concerningmerchandise entered under the North American Free Trade Agree-ment (NAFTA issues/claims) and under the United States – ChileFree Trade Agreement (CFTA or Chile issues/claims) that are eli-gible for treatment under 19 U.S.C. 1520(d).

The flagged entry summary (the underlying entry summary) is liq-uidated for all aspects of the entry except those issues that wereflagged. The means of providing the outstanding information at alater date relative to the flagged issues is through the filing of a Rec-onciliation entry. The flagged issues will be liquidated at the timethe Reconciliation entry is liquidated. Any adjustments in duties,taxes, and/or fees owed will be made at that time. (See the February


6, 1998, Federal Register notice for a more detailed presentation ofthe basic Reconciliation process.)

CBP reminds test participants that the filing of a Reconciliationentry, like the filing of a regular consumption entry, is governed by19 U.S.C. 1484 and can be done only by the importer of record as de-fined in that statute.

Test Modification

The Agreement and the Implementation Act

The Dominican Republic-Central America-United States FreeTrade Agreement (CAFTA-DR or the Agreement) was entered into bythe governments of Costa Rica, the Dominican Republic, El Salva-dor, Guatemala, Honduras, Nicaragua, and the United States on Au-gust 5, 2004. The United States Congress approved the CAFTA-DRin the Dominican Republic-Central America-United States FreeTrade Agreement Implementation Act (the Implementation Act),Public Law 109–53, 119 Stat. 462 (19 U.S.C. 4001 et seq.). Under theImplementation Act, the provisions of the CAFTA-DR become effec-tive for individual CAFTA-DR countries (defined under the Imple-mentation Act to include all countries that are signatory to theAgreement except the United States) only when the Agreement en-ters into force for a CAFTA-DR country upon issuance of a presiden-tial proclamation to that effect, an action that is conditioned uponthe fulfillment of certain requirements (i.e., the CAFTA-DR countryhas taken measures to comply with the provisions of the Agree-ment). Importations of originating goods of such a CAFTA-DR coun-try are entitled to the benefits of the Agreement as of the effectivedate set forth in the presidential proclamation and in accordancewith the Implementation Act and new General Note 29 of the Har-monized Tariff Schedule of the United States (HTS).

As of the date of this notice, the Agreement has entered into forcefor three CAFTA-DR countries: El Salvador, in accordance withPresidential Proclamation 7987, issued on February 28, 2006 (71 FR10827; March 2, 2006)(see also U.S. International Trade Commission(USITC) Publication 3829, February 2006), and Honduras and Nica-ragua, in accordance with Presidential Proclamation 7996, issued onMarch 31, 2006 (71 FR 16971; April 4, 2006)(see also USITC Publica-tion 3845, April 2006).

Ordinary CAFTA-DR claim and post-importation CAFTA-DR claimunder 19 U.S.C. 1520(d)

A claim for preferential tariff treatment for an originatingCAFTA-DR good, in accordance with CAFTA-DR and applicable pro-cedures (regulations are forthcoming), is made at the time of entry


summary. (See General Note 29, HTSUS, for rules of origin.) How-ever, in some instances, an importer may not be able to make theclaim at that time, usually because the importer does not possess allthe information or documentation required. In those instances, animporter may make a post-importation CAFTA-DR claim under 19U.S.C. 1520(d) (section 1520(d)), pursuant to an amendment to thatsection made by the Implementation Act (section 207). Under thisamendment to section 1520(d), entries of goods qualifying underCAFTA-DR rules of origin are eligible for reliquidation when prefer-ential tariff treatment under CAFTA-DR is not claimed at the timeof importation, notwithstanding that a protest under 19 U.S.C. 1514(section 1514) is not timely filed. (A section 1514 protest is a meansof objecting to, among other things, the liquidation of an entry by fil-ing the protest within 180 days of the liquidation (or other protest-able decision or action by CBP).) A claimant must file a claim undersection 1520(d) within one year of the applicable importation andmeet other requirements, such as applicable documentary require-ments, including (when requested by CBP) the filing of a certifica-tion or information demonstrating that the entered goods are origi-nating CAFTA-DR goods.

Post-importation CAFTA-DR claim under Reconciliation

This notice announces that a post-importation claim for preferen-tial tariff treatment under section 1520(d) for an entry filed pursu-ant to the CAFTA-DR also may be made under the Reconciliationtest, in the same way as a post-importation NAFTA or Chile claimmay be made (see, respectively, notices published in the FederalRegister on September 27, 2002, and September 2, 2004, cited pre-viously). This alternative requires that an importer follow the Recon-ciliation test procedure which, in contrast to the ordinary section1520(d) procedure described above, requires action at the time of en-try. That action is to flag the entry summary for the CAFTA-DR is-sue(s), which will be followed later by the filing of a Reconciliationentry within one year of the applicable importation. It is noted thatCAFTA-DR Reconciliation entries cannot include other Recon-ciliation-eligible issues; i.e., a CAFTA-DR Reconciliation entry is lim-ited to covering only CAFTA-DR issues (claims). NAFTA and ChileReconciliation entries/claims are similarly limited.

This CAFTA-DR Reconciliation alternative is available for eli-gible importations involving any eligible CAFTA-DR country (aCAFTA-DR country as to which the Agreement has entered intoforce) 90 days after the date this notice is published in the FederalRegister.

Reconciliation CAFTA-DR claim precludes claims by other means

CBP emphasizes that once an importer flags an entry summaryfor CAFTA-DR issues for Reconciliation, indicating that it is pursu-


ing the post-importation, section 1520(d) claim through the Recon-ciliation process, the only means of perfecting the CAFTA-DR claimis by completing the Reconciliation process by filing a timely Recon-ciliation entry. (See the September 27, 2002, Federal Register no-tice for an explanation of this same limitation relative to NAFTA andChile issues.) By flagging the entry summary, the importer makes acommitment to perfect the claim only through the Reconciliationprocess - to, in effect, waive filing the claim any other way. Thus,once entries have been flagged for Reconciliation of CAFTA-DR is-sues, CBP will not accept a claim filed for those entries under the or-dinary section 1520(d) procedure. This will prevent dual filings forthe same underlying entry summaries.

Benefits of Reconciliation

Finally, CBP recommends the use of the Reconciliation test proce-dure for making post-importation CAFTA-DR claims because thetest procedure provides the importer with several benefits. First, us-ing the test procedure is a simpler means of filing claims: i.e., theimporter is able to make potentially thousands of CAFTA-DR claimson one Reconciliation entry. Second, the importer can receive onecheck from CBP rather than many (even up to thousands) uponCBP’s liquidation of a Reconciliation entry and issuance of a refund.Third, because processing CAFTA-DR claims under Reconciliation issimpler for CBP, the refund delivery system is more efficient.


WILLIAM S. HEFFELFINGER III,Acting Assistant Commissioner,

Office of Field Operations.


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QUARTERLY IRS INTEREST RATES USED INCALCULATING INTEREST ON OVERDUE ACCOUNTS AND

REFUNDS ON CUSTOMS DUTIES

AGENCY: Bureau of Customs and Border Protection, Departmentof Homeland Security.

ACTION: General notice.

SUMMARY: This notice advises the public of the quarterly InternalRevenue Service interest rates used to calculate interest on overdueaccounts (underpayments) and refunds (overpayments) of customsduties. For the calendar quarter beginning July 1, 2006, the interestrates for overpayments will increase from 6 to 7 percent for corpora-tions and from 7 to 8 percent for non-corporations, and the interest


rate for underpayments will increase from 7 to 8 percent. This noticeis published for the convenience of the importing public and Cus-toms and Border Protection personnel.

EFFECTIVE DATE: July 1, 2006.

FOR FURTHER INFORMATION CONTACT: Ron Wyman, Rev-enue Division, Collection and Refunds Branch, 6650 Telecom Drive,Suite #100, Indianapolis, Indiana 46278; telephone (317) 614–4516.


Background

Pursuant to 19 U.S.C. 1505 and Treasury Decision 85–93, pub-lished in the Federal Register on May 29, 1985 (50 FR 21832), theinterest rate paid on applicable overpayments or underpayments ofcustoms duties must be in accordance with the Internal RevenueCode rate established under 26 U.S.C. 6621 and 6622. Section 6621was amended (at paragraph (a)(1)(B) by the Internal Revenue Ser-vice Restructuring and Reform Act of 1998, Public Law 105–206, 112Stat. 685) to provide different interest rates applicable to overpay-ments: one for corporations and one for non-corporations.

The interest rates are based on the Federal short-term rate anddetermined by the Internal Revenue Service (IRS) on behalf of theSecretary of the Treasury on a quarterly basis. The rates effective fora quarter are determined during the first-month period of the previ-ous quarter.

In Revenue Ruling 2006–30, the IRS determined the rates of inter-est for the calendar quarter beginning July 1, 2006, and ending Sep-tember 30, 2006. The interest rate paid to the Treasury for under-payments will be the Federal short-term rate (5%) plus threepercentage points (3%) for a total of eight percent (8%). For corpo-rate overpayments, the rate is the Federal short-term rate (5%) plustwo percentage points (2%) for a total of seven percent (7%). Foroverpayments made by non-corporations, the rate is the Federalshort-term rate (5%) plus three percentage points (3%) for a total ofeight percent (8%). These interest rates are subject to change for thecalendar quarter beginning October 1, 2006, and ending December31, 2006.

For the convenience of the importing public and Customs and Bor-der Protection personnel the following list of IRS interest rates used,covering the period from before July of 1974 to date, to calculate in-terest on overdue accounts and refunds of customs duties, is pub-lished in summary format.


BeginningDate

EndingDate

Under-payments(percent)

Over-payments(percent)

CorporateOverpay-ments(Eff. 1–1–99)(percent)

070174 063075 6% 6%070175 013176 9 % 9 %020176 013178 7 % 7 %020178 013180 6 % 6 %020180 013182 12 % 12 %020182 123182 20 % 20 %010183 063083 16 % 16 %070183 123184 11 % 11 %010185 063085 13 % 13 %070185 123185 11 % 11 %010186 063086 10 % 10 %070186 123186 9 % 9 %010187 093087 9 % 8 %100187 123187 10 % 9 %010188 033188 11 % 10 %040188 093088 10 % 9 %100188 033189 11 % 10 %040189 093089 12 % 11 %100189 033191 11 % 10 %040191 123191 10 % 9 %010192 033192 9 % 8 %040192 093092 8 % 7 %100192 063094 7 % 6 %070194 093094 8 % 7 %100194 033195 9 % 8 %040195 063095 10 % 9 %070195 033196 9 % 8 %040196 063096 8 % 7 %070196 033198 9 % 8 %040198 123198 8% 7%010199 033199 7% 7% 6%040199 033100 8% 8% 7%040100 033101 9% 9% 8%040101 063001 8% 8% 7%070101 123101 7% 7% 6%010102 123102 6% 6% 5%010103 093003 5% 5% 4%100103 033104 4% 4% 3%040104 063004 5% 5% 4%070104 093004 4% 4% 3%100104 033105 5% 5% 4%


BeginningDate

EndingDate

Under-payments(percent)

Over-payments(percent)

CorporateOverpay-ments(Eff. 1–1–99)(percent)

040105 093005 6% 6% 5%100105 063006 7% 7% 6%070106 093006 8% 8% 7%


DEBORAH J. SPERO,Acting Commissioner,

Bureau of Customs and Border Protection.



DEPARTMENT OF HOMELAND SECURITY,OFFICE OF THE COMMISSIONER OF CUSTOMS.

Washington, DC, June 28, 2006,The following documents of the Bureau of Customs and Border

Protection (‘‘CBP’’), Office of Regulations and Rulings, have been de-termined to be of sufficient interest to the public and CBP field of-fices to merit publication in the CUSTOMS BULLETIN.

SANDRA L. BELL,Acting Assistant Commissioner,

Office of Regulations and Rulings.

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19 CFR PART 177

REVOCATION OF RULING LETTER AND TREATMENTRELATING TO TARIFF CLASSIFICATION OF ELECTRODE

STEAM HUMIDIFIERS

AGENCY: U. S. Customs and Border Protection (CBP), Departmentof Homeland Security.

ACTION: Revocation of ruling letter and treatment relating to tar-iff classification of electrode steam humidifiers.

SUMMARY: Pursuant to section 625(c), Tariff Act of 1930 (19U.S.C. 1625(c)), as amended by section 623 of Title VI (CustomsModernization) of the North American Free Trade Agreement Imple-mentation Act (Pub. L. 103–182, 107 Stat. 2057), this notice advisesinterested parties that CBP is revoking a ruling relating to the clas-sification of electrode steam humidifiers under the Harmonized Tar-iff Schedule of the United States (HTSUS), and revoking any treat-ment CBP has previously accorded to substantially identicaltransactions. These articles add humidity to air using steam createdby introducing electricity to electrodes immersed in water. Notice ofthe proposed revocation was published on May 17, 2006, in the Cus-toms Bulletin, Vol. 40, No. 21. No comments were received in re-sponse to this notice.

EFFECTIVE DATE: This revocation is effective for merchandiseentered or withdrawn from warehouse for consumption on or afterSeptember 10, 2006.

FOR FURTHER INFORMATION CONTACT: James A. Seal,Tariff Classification and Marking Branch (202) 572–8779.



Background

On December 8, 1993, Title VI (Customs Modernization) of theNorth American Free Trade Agreement Implementation Act (Pub. L.103–182, 107 Stat. 2057), became effective. Title VI amended manysections of the Tariff Act of 1930, as amended, and related laws. Twonew concepts which emerge from the law are informed compli-ance and shared responsibility. These concepts are based on thepremise that in order to maximize voluntary compliance with cus-toms laws and regulations, the trade community needs to be clearlyand completely informed of its legal obligations. Accordingly, the lawimposes a greater obligation on CBP to provide the public with im-proved information concerning the trade community’s rights and re-sponsibilities under the customs and related laws. In addition, boththe trade and CBP share responsibility in carrying out import re-quirements. For example, under section 484, Tariff Act of 1930, asamended (19 U.S.C. 1484), the importer of record is responsible forusing reasonable care to enter, classify and declare value on im-ported merchandise, and to provide other necessary information toenable CBP to properly assess duties, collect accurate statistics anddetermine whether any other legal requirement is met.

Pursuant to CBP’s obligations, a notice was published on May 17,2006, in the Customs Bulletin, Volume 40, Number 21, proposing torevoke HQ 958017, dated February 13, 1996, which classified certainindustrial-type humidifiers in subheading 8543.80.75, HTSUS, asother electrical machines and apparatus having individual func-tions. No comments were received in response to this notice.

As stated in the proposed notice, this revocation will cover any rul-ings on this merchandise which may exist but have not been specifi-cally identified. Any party who has received an interpretative rulingor decision (i.e., ruling letter, internal advice memorandum or deci-sion, or protest review decision) on the merchandise subject to thisnotice, should have advised CBP during the comment period. Simi-larly, pursuant to section 625(c)(2), Tariff Act of 1930 (19 U.S.C.1625(c)(2)), as amended by section 623 of Title VI, CBP is revokingany treatment it previously accorded to substantially identicaltransactions. Any person involved in substantially identical transac-tions should have advised CBP during this notice period. An import-er’s failure to advise CBP of substantially identical transactions or ofa specific ruling not identified in this notice may raise issues of rea-sonable care on the part of the importer or its agents for importa-tions subsequent to the effective date of this final decision.

Pursuant to 19 U.S.C. 1625(c)(1), CBP is revoking HQ 958017 toreflect the proper classification of the described humidifiers in sub-heading 8516.10.0080, Harmonized Tariff of the United States Anno-tated, as electric instantaneous or storage water heaters and immer-


sion heaters, in accordance with the analysis in HQ 968027, which isset forth as the Attachment to this document. Additionally, pursuantto 19 U.S.C. 1625(c)(2), CBP is revoking any treatment it previouslyaccorded to substantially identical transactions.

In accordance with 19 U.S.C. 1625(c), this ruling will become effec-tive 60 days after publication in the Customs Bulletin.

DATED: June 21, 2006

Gail A. Hamill for MYLES B. HARMON,Director,

Commercial and Trade Facilitation Division.

Attachment

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DEPARTMENT OF HOMELAND SECURITY.BUREAU OF CUSTOMS AND BORDER PROTECTION,

HQ 968027June 21, 2006

CLA–2 RR:CTF:TCM 968027 JASCATEGORY: ClassificationTARIFF NO.: 8516.10.0080

TOWER GROUP INTERNATIONAL, INC.205 West Service RoadChamplain, NY 12919

RE: Electrode Steam Humidifiers; HQ 958017 Revoked

DEAR SIRS:In HQ 958017, which the Director, Tariff Classification Appeals (now

Commercial and Trade Facilitation) Division, Headquarters, issued to youon February 13, 1996, on behalf of Nortec Industries, Inc., Ogdensburg, NY,certain electrode steam humidifiers were found to be classifiable as otherelectrical machines and apparatus, having individual functions, not speci-fied or included elsewhere in [chapter 85], in subheading 8543.80.75, Har-monized Tariff Schedule of the United States (HTSUS).

Pursuant to section 625(c), Tariff Act of 1930 (19 U.S.C. 1625(c)), asamended by section 623 of Title VI (Customs Modernization) of the NorthAmerican Free Trade Agreement Implementation Act, Pub. L. 103–182, 107Stat. 2057, 2186 (1993), notice of the proposed revocation of HQ 958017 waspublished on May 17, 2006, in the Customs Bulletin, Volume 40, Number 21.No comments were received in response to this notice.

As stated in the May 17 notice, HQ 958017 represents a decision on a pro-test filed with the Port Director, U.S. Customs and Border Protection,Ogdensburg, NY, on behalf of Nortec Industries, Inc. Therefore, CBP’s revo-cation of HQ 958017 will affect the legal principles in that decision but theliquidation or reliquidation of the underlying entries remains undisturbed.See San Francisco Newspaper Printing Co. v. United States, 620 F. Supp.738, 9 CIT 517 (1985).


FACTS:The humidifiers were described in HQ 958017 as creating steam which is

used to add moisture, i.e., humidity, to the air that passes through a fur-nace. The steam is produced by means of hot water produced by an electriccurrent generated between electrodes immersed in the water. The modelNHMC humidifier is imported with a blower unit, which is in a separatehousing that is mounted to the humidifier, while the model MES humidifieris imported without a blower unit, in which case the furnace blower is uti-lized to propel the steam and air stream through ductwork and into the en-vironment. Both models are operated by microcomputer.

Submitted literature identifies humidifiers with design features andspecifications that suggest industrial applications. The cycle of operation isdescribed ‘‘On demand from the humidistat, the primary contractor is ener-gized; the fill solenoid opens and allows water to enter the cylinder throughthe fill cup; current flows between the electrodes in the water; once full loadamps are reached the fill valve closes; as water boils away the low amp trig-ger reactivates the fill valve; pure steam is discharged, the water-borne min-erals are left behind in the cylinder gradually increasing water conductivity;auto-drain takes over only when water is fully concentrated.’’

The humidifiers were entered under subheading 8479.89.10, HTSUS,which provides for machines and mechanical appliances having individualfunctions, not specified or included elsewhere in this chapter, electrome-chanical appliances with self-contained electric motor, air humidifiers or de-humidifiers. They were classified in liquidation under subheading8419.19.00, HTSUS, which provides for nonelectric instantaneous or storagewater heaters. HQ 958017 held that neither of these provisions describedthe humidifiers and they were classified in subheading 8543.80.75, HTSUS.

The HTSUS provisions under consideration are as follows:

8516 Electric instantaneous or storage water heaters and immer-sion heaters; . . . ; other electrothermic appliances of a kindused for domestic purposes; . . . ; parts thereof:

8516.10.00 Electric instantaneous or storage water heaters andimmersion heaters

* * * *

8543 Electrical machines and apparatus, having individual func-tions, not specified or included elsewhere in [chapter 85];parts thereof:

Other machines and apparatus:

8543.89 Other:

Other:

Other:

8543.89.96 (formerly 80.75) Other

ISSUE:Whether electrode steam humidifier models NHMC and MES are goods of

heading 8516.


LAW AND ANALYSIS:Under General Rule of Interpretation (GRI) 1, Harmonized Tariff Sched-

ule of the United States Annotated (HTSUSA), goods are to be classified ac-cording to the terms of the headings and any relative section or chapternotes, and provided the headings or notes do not require otherwise, accord-ing to GRIs 2 through 6.

The Harmonized Commodity Description and Coding System ExplanatoryNotes (ENs) constitute the official interpretation of the Harmonized Systemat the international level. Though not dispositive, the ENs provide a com-mentary on the scope of each heading of the HTSUS. U.S. Customs and Bor-der Protection believes the ENs should always be consulted. See T.D. 89–80,54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).

Initially, we are aware that air humidifiers and dehumidifiers which areelectromechanical appliances with self-contained electric motor are providedfor by name in subheading 8479.89.10, HTSUS. HQ 958017 noted that factbut concluded both heading 8479 and heading 8543, by their terms, mustyield to a heading or headings which more specifically describe the humidifi-ers, either in Chapters 84 or 85, or elsewhere in the HTSUS.

HQ 958017 discounted heading 8516, electrothermic appliances of a kindused for domestic purposes, on the basis that the provision was limited todomestic-type appliances. This is incorrect. The provision in heading 8516for electric instantaneous or storage water heaters and immersion heaters isnot circumscribed by the requirement that that they be for domestic pur-poses. We have again considered this provision and now believe that it de-scribes the merchandise at issue.

The 85.16 ENs, under (A) ELECTRIC INSTANTANEOUS OR STORAGEWATER HEATERS AND IMMERSION HEATERS, describe (4) Electrodehot water boilers in which an [alternating current] AC passes through thewater between two electrodes. Thus, electrode hot water boilers produce hotwater. The term boiler frequently is used to describe appliances that produceboth steam and hot water. The Institution of Electrical Engineers (lEE) pub-lishes The Electrician’s Guide, 16th Ed. which defines an electrode heater orboiler as a device which heats the water contained, or raises steam. www.tic-direct.co.uk/Book/7.11.2.htm. Further, the website for the American Societyof Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) con-tains a reference to the Herrmidifier Company that offers the HerrtronicMD series self-contained electrode boilers, designed for steam humidifica-tion systems in computer rooms, telecommunication switchgear facilitiesand laboratory cleanrooms. www.ashrae.org. This information warrants theconclusion that the function of electrode boilers is to produce hot water withsteam being a byproduct for the purpose of introducing moisture into the air(humidity). Such apparatus is provided for in heading 8516. This findingeliminates heading 8543 from consideration.

HOLDING:Under the authority of GRI 1, the electrode steam humidifiers, models

NHMC and MES, are provided for in heading 8516. They are classifiable insubheading 8516.10.0080, HTSUSA.


EFFECT ON OTHER RULINGS:HQ 958017, dated February 13, 1996, is revoked. In accordance with 19

U.S.C. 1625(c), this ruling will become effective 60 days after its publicationin the Customs Bulletin.

Gail A. Hamill for MYLES B. HARMON,Director,


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PROPOSED REVOCATION OF A RULING LETTER ANDREVOCATION OF TREATMENT RELATING TO TARIFF

CLASSIFICATION OF AN AUDIO VISUAL LAPTOP

AGENCY: Bureau of Customs and Border Protection; Departmentof Homeland Security.

ACTION: Proposed revocation of a tariff classification ruling letterand revocation of treatment relating to the classification of an audiovisual laptop.

SUMMARY: Pursuant to section 625(c), Tariff Act of 1930, asamended (19 U.S.C. 1625(c)), this notice advises interested partiesthat the Bureau of Customs and Border Protection (CBP) is propos-ing to revoke a ruling letter relating to the tariff classification of anaudio visual laptop under the Harmonized Tariff Schedule of theUnited States (HTSUS). CBP is also proposing to revoke any treat-ment previously accorded by it to substantially identical transac-tions.

DATE: Comments must be received on or before August 11, 2006.

ADDRESS: Written comments are to be addressed to the Bureau ofCustoms and Border Protection, Office of Regulations & Rulings, At-tention: Trade and Commercial Regulations Branch, 1300 Pennsyl-vania Avenue N.W., Washington, D.C. 20229. Submitted commentsmay be inspected at the offices of Customs and Border Protection,799 9th Street, NW, Washington, D.C. during regular business hours.Arrangements to inspect submitted comments should be made in ad-vance by calling Mr. Joseph Clark at (202) 572–8768.

FOR FURTHER INFORMATION CONTACT: Kelly Herman,Tariff Classification and Marking Branch: (202) 572–8713.


BACKGROUND

On December 8, 1993, Title VI (Customs Modernization) of theNorth American Free Trade Agreement Implementation Act (Pub. L.103–182, 107 Stat. 2057) (hereinafter ‘‘Title VI’’), became effective.


Title VI amended many sections of the Tariff Act of 1930, asamended, and related laws. Two new concepts which emerge fromthe law are ‘‘informed compliance’’ and ‘‘shared responsibility.’’These concepts are premised on the idea that in order to maximizevoluntary compliance with customs laws and regulations, the tradecommunity needs to be clearly and completely informed of its legalobligations. Accordingly, the law imposes a greater obligation onCBP to provide the public with improved information concerning thetrade community’s responsibilities and rights under the customs andrelated laws. In addition, both the trade and CBP share responsibil-ity in carrying out import requirements. For example, under section484 of the Tariff Act of 1930, as amended (19 U.S.C. § 1484), the im-porter of record is responsible for using reasonable care to enter,classify and value imported merchandise, and provide any other in-formation necessary to enable CBP to properly assess duties, collectaccurate statistics and determine whether any other applicable legalrequirement is met.

Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C.1625(c)(1)), as amended by section 623 of Title VI, this notice advisesinterested parties that CBP is proposing to revoke a ruling letterpertaining to the tariff classification of an audio visual laptop. Al-though in this notice, CBP is specifically referring to the revocationof New York Ruling Letter (NY) K88339, dated August 17, 2004 (At-tachment A), this notice covers any rulings on this merchandisewhich may exist but have not been specifically identified. CBP hasundertaken reasonable efforts to search existing databases for rul-ings in addition to the one identified. No further rulings have beenfound. Any party who has received an interpretive ruling or decision(i.e., a ruling letter, internal advice memorandum or decision or pro-test review decision) on the merchandise subject to this noticeshould advise CBP during the notice period.

Similarly, pursuant to section 625(c)(2), Tariff Act of 1930 (19U.S.C. 1625(c)(2)), as amended by section 623 of Title VI, CBP is pro-posing to revoke any treatment previously accorded by CBP to sub-stantially identical transactions. Any person involved in substan-tially identical transactions should advise CBP during this noticeperiod. An importer’s failure to advise CBP of substantially identicaltransactions or of a specific ruling not identified in this notice, mayraise issues of reasonable care on the part of the importer or itsagents for importations of merchandise subsequent to the effectivedate of the final decision on this notice.

In NY K88339, CBP ruled that the Qosimo AV Notebook PC E15was classified in heading 8528, HTSUS, which provides for: ‘‘Recep-tion apparatus for television, whether or not incorporatingradiobroadcast receivers or sound or video recording or reproducingapparatus; video monitors and video projectors.’’


Pursuant to 19 U.S.C. 1625(c)(1), CBP is proposing to revoke NYK88339 and is proposing to revoke or modify any other ruling notspecifically identified, to reflect the proper classification of audio vi-sual laptops according to the analysis contained in HeadquartersRuling Letters (HQ) 967655, set forth as Attachment B to this docu-ment. Additionally, pursuant to 19 U.S.C. 1625(c)(2), CBP is propos-ing to revoke any treatment previously accorded by CBP to substan-tially identical transactions. Before taking this action, we will giveconsideration to any written comments timely received.

DATED: June 26, 2006

MYLES B. HARMON,Director,


Attachments

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[ATTACHMENT A]


NY K88339August 17, 2004 CLA–2–85: RR: NC: 1:108 K88339

CATEGORY: ClassificationTARIFF NO.: 8528.12.7201

MS. IVY WONGTOSHIBA\9740 Irvine BoulevardIrvine, California 92618–1697

RE: The tariff classification of a laptop computer/television from China.

DEAR MS. WONG:In your letter dated August 4, 2004 you requested a tariff classification

ruling.The item in question is the Toshiba audio video laptop personal computer

denoted under the brand name of Qosmio. Internally within the company itis denoted as model number E15.

The item, in the form of a laptop personal computer, is actually a dualfunctioning device. It is equipped with an Intel Pentium M processor 735,64MB Graphics, 512 MB memory, a 159 XGA screen, 80GB hard disk drive,fixed 2-spindle DVD drives, WiFi 802.11g, XP-MCE operating system and anintegrated TV tuner.

This device clearly has two distinct independent functions. It can operateas a personal computer and as a television. The tuner provides the televisionfunction through the reception and demodulation of an NTSC televisionbroadcast signal. Television broadcasts are viewed directly on the 15 - inchflat panel screen. It is important to note that the TV tuner actually sits ontop of the main system board where the central processing unit is located.


The traditional internal TV tuner on other laptops is a separate device thatis connected to the expansion port. This tuner is neither an expansion cardnor does it connect to the PC expansion bus.

The TV signals are controlled and processed by the tuner and not by anyother PC hardware contained within this particular laptop model. The tele-vision is operated independently from the regular computer functions with-out the use of any software and the computer does not have to be turned onfor one to receive NTSC television broadcast signals. The device does func-tion as a dual device with each function operating independently at the dis-cretion of the user.

Note 3 to Section XVI of the Harmonized Tariff Schedule of the UnitedStates (HTS) provides, in pertinent part, that unless the context requiresotherwise, machines adapted for the purpose of performing two or morecomplimentary or alternative functions are to be classified as if consistingonly of that component or being that machine which performs the principalfunction.

Based upon the submitted information it is the opinion of this office thatthe Qosmio audio video laptop personal computer does not have a singleprincipal function. Therefore classification will be in accordance with GRI 3cwhich indicates that when goods cannot be classified by reference to GRI 3aor 3b, they shall be classified under the heading which occurs last in nu-merical order among those which merit equal consideration.

The applicable subheading for the Qosmio audio video laptop personalcomputer will be 8528.12.7201 Harmonized Tariff Schedule of the UnitedStates (HTS), which provides for Reception apparatus for television,whether or not incorporating radiobroadcast receivers or sound or videorecording or reproducing apparatus; video monitors and video projectors: re-ception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus:Color: With a flat panel screen: Other: Other. The rate of duty will be 5 per-cent ad valorem This ruling is being issued under the provisions of Part 177of the Customs Regulations (19 C.F.R. 177).

A copy of the ruling or the control number indicated above should be pro-vided with the entry documents filed at the time this merchandise is im-ported. If you have any questions regarding the ruling, contact National Im-port Specialist Michael Contino at 646–733–3014.

ROBERT B. SWIERUPSKI,Director,

National Commodity Specialist Division.


[ATTACHMENT B]


HQ 967655CLA–2 RR: CTF:TCM 967655 KSH

CATEGORY: ClassificationTARIFF NO.: 8471.30.0000

MR. JOEL WINNICK, ESQ.MS. TERRY POLINO, ESQ.HOGAN & HARTSON, LLPColumbia Square555 13th Street, N.W.Washington, D.C. 20004–1109

RE: Revocation of New York Ruling Letter (NY) K88339, dated August 17,2004; Classification of an Audio/Video Laptop.

DEAR MR. WINNICK AND MS. POLINO:This is in response to your letter of April 1, 2005, on behalf of your client

Toshiba America Information Systems, Inc. (TAIS), in which you request re-consideration of New York Ruling Letter (NY) K88339, issued on August 17,2004, concerning the classification under the Harmonized Tariff Schedule ofthe United States (HTSUS) of the Qosmio AV Notebook PC E15 (Qosmio).The Qosmio was classified in heading 8528, HTSUS, which provides for:‘‘Reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus;video monitors and video projectors.’’ We regret the delay in responding.

In your request for reconsideration, you have advised us that the Qosmio’saudio visual function requires the user to turn on the computer and is fullydependent upon the PC’s operating systems. You have also stated that theQosmio has the general characteristics of an automatic data processing(ADP) machine, the purchaser of the Qosmio expects to principally be buy-ing an ADP machine, the Qosmio is designed, manufactured, marketed andsold in a channel of trade and an environment of sale devoted to ADP ma-chines and it is used principally by consumers as an ADP machine. Accord-ingly, you argue that the principal function of the Qosmio is as an ADP ma-chine that should be classified in heading 8471, HTSUS, which provides for:‘‘Automatic data processing machines and units thereof . . .’’. In accordancewith your request for reconsideration of NY K88339 and in light of thisnewly submitted information, including information submitted in conjunc-tion with the meeting held with members of my staff on January 27, 2006,the Bureau of Customs and Border Protection (CBP) has reviewed the clas-sification of this item and has determined that the cited ruling is in error.

FACTS:The Qosmio is a clamshell-configured notebook computer which measures

13.319 by 11.229 by 1.709 and weighs approximately 8.2 lbs. The Qosmio con-tains the following core hardware and software components:


80GB Hard Disk Drive512 MB RAMIntel Pentium M Processor 735Intel 855PM System ChipsetMicrosoft XP Media Center Edition Operating System159 XGA TruBrite DisplayCD/DVDNVIDIA GeForce FX Go5200 GraphicsHarmon/Kardon premium stereo speakersFour USB 2.0 PortsIntegrated V.92 Modem, 10/100 EthernetKeyboard and touchpadParallel Linux Operating SystemWireless LAN B and GBluetooth EnabledSurround SoundBridge Media AdapterDVDS-video input and output for DVR, DVD and other video applicationsi.Link for high speed communicationsAnalog TV tuner

The audio visual features of the Qosmio may be employed through either ofthe Qosmio’s two operating systems (Windows XP Media Center Edition andLinux). However, users who do not need to simultaneously run the audio vi-sual features and perform data processing functions controlled by the Win-dows XP Media Center may chose to exclusively run the Linux operatingsystem. Two separate power buttons allow the user to choose either the TVor computer features.

If the TV power button is used, the data stream is picked up by the ADPperipheral interconnect bus and is transferred through the ADP system busto the ADP processor and memory. Stated another way, the TV cannot func-tion without the ADP hardware. Its electrical and logical functions are di-rected through the ADP machine.

ISSUE:Whether the Qosmio is classified in heading 8528, HTSUS, as reception

apparatus for television or in heading 8471, HTSUS, as an automatic dataprocessing machine.

LAW AND ANALYSIS:Classification under the HTSUS is made in accordance with the General

Rules of Interpretation (‘‘GRIs’’). GRI 1 provides that the classification ofgoods shall be determined according to the terms of the headings of the tar-iff schedule and any relative Section or Chapter Notes. In the event that thegoods cannot be classified solely on the basis of GRI 1, and if the headingsand legal notes do not otherwise require, the remaining GRIs may then beapplied.

The Harmonized Commodity Description and Coding System ExplanatoryNotes (‘‘ENs’’) constitute the official interpretation of the Harmonized Sys-tem at the international level. While not legally binding, the ENs provide a


commentary on the scope of each heading of the HTSUS and are thus usefulin ascertaining the classification of merchandise under the Harmonized Sys-tem. CBP believes the ENs should always be consulted. See T.D. 89–80, 54Fed. Reg. 35127, 35128 (August 23, 1989).

The HTSUS provisions under consideration are as follows:

8471 Automatic data processing machines and units thereof:

8471.30.00 Portable digital automatic data processing machines,weighing not more than 10 kg, consisting of at least acentral processing unit, a keyboard and a display

8528 Reception apparatus for television, whether or not incorpo-rating radiobroadcast receivers or sound or video recordingor reproducing apparatus; video monitors and video projec-tors:

Reception apparatus for television, whether or not in-corporating radiobroadcast receivers or sound or videorecording or reproducing apparatus:

8528.12 Color:

With a flat panel screen:

Other:

8528.12.7201 Other.’’

Note 5(A) to chapter 84, HTSUS, defines the term ‘‘automatic data process-ing machines’’ for the purposes of heading 8471 as digital machines whichmust be capable of (1) storing the processing program or programs and atleast the data immediately necessary for execution of the program; (2) beingfreely programmed in accordance with the requirements of the user; (3) per-forming arithmetical computations specified by the user; and (4) executing,without human intervention, a processing program which requires them tomodify their execution, by logical decision during the processing run.

Pursuant to Note 5(A)(a), the Qosmio prima facie meets the terms ofHeading 8471, HTSUS, as an ADP machine. However, it is also capable ofdisplaying a variety of tv signals and other audio visual information whichis provided for, eo nomine, under heading 8528, HTSUS, as reception appa-ratus for television.

The Qosmio is therefore considered a composite machine that has thefunctions of both an ADP machine and a reception apparatus for television.Classification of composite machines is regulated by Note 3 to Section XVI,HTSUS, which provides that:

Unless the content otherwise requires, composite machines consisting oftwo or more machines fitted together to form a whole and other ma-chines designed for the purpose of performing two or more complemen-tary or alternative functions are to be classified as if consisting only ofthat component or as being that machine which performs the principalfunction.


It is the principal use of the class or kind of goods to which the imports be-long at or immediately prior to the time of importation and not the principaluse of the specific import that is controlling under the General Rules of In-terpretation. See Group Italglass U.S.A., Inc. v. United States, 17 C.I.T.1177, 1177, 839 F. Supp. 866, 867 (1993)

The courts have provided factors, which are indicative but not conclusive,to apply when determining whether merchandise falls within a particularclass or kind. They include: (1) general physical characteristics; (2) expecta-tion of the ultimate purchaser; (3) channels of trade; (4) environment of sale(accompanying accessories, manner of advertisement and display); and (5)usage of the merchandise. See Lenox Collections v. U.S., 20 CIT 194, 196(1996). See also U.S. v. Carborundum Co., 63 CCPA 98, 102, 536 F. 2d 373,377 (1976), cert denied, 429 U.S. 979 (1976); Kraft, Inc. v. U.S., 16 CIT 483,489 (1992); and G. Heileman Brewing Co. v. U.S., 14 CIT 614, 620 (1990).

In considering these factors, we note that the 15 inch screen size, screenresolution of 1024 by 768, standard 84 key keyboard and touch pad, USBand i.Link ports, hard drive and clamshell configuration are consistent withthe general physical characteristics of an ADP machine. In this regard, wenote that the Qosmio is not an ADP unit but is a complete, integrated ADPmachine. (Cf. the classification opinion by World Customs Organization(WCO), Harmonized System Committee (HSC), at its 19th Session to classifya multimedia personal computer system consisting of three separatelyhoused units: a 149 (35 cm) colour television receiver (display) with a digitalprocessing unit, a keyboard (input unit), and an infra-red remote control de-vice in subheading 8471.49, HTS, and NY K82971, dated February 26, 2004,in which a Gateway 610 Media Center PC desktop computer system with in-tegrated TV tuner card was classified in subheading 8471.49.1095, HTSUS.

The TV tuner and ADP are not two separate machines. Rather, the TVfunction is dependent on the ADP hardware. Even when the TV is in use theIntel Pentium M Processor 735, Intel 855PM chipset and memory chips areADP hardware that must be used.

Probative evidence included in your submission indicates that consumersare primarily purchasing the Qosmio for its ADP functions with ancillary in-terest in the audio visual functions. The Qosmio is marketed and sold inchannels of trade for ADP machines. The Qosmio is sold in the ADP depart-ments of consumer electronic retailers and are advertised as such. TheQosmio is also sold to retailers who primarily sell ADP equipment and soft-ware. Further, evidence has been submitted that the overwhelming majorityof purchasers use the Qosmio for its data processing functions while fewregularly use the Qosmio to watch television.

Based on the Carborundum factors and the information above, we findthat the principal function of the Qosmio is an ADP machine of heading8471, HTSUS.

HOLDING:By application of GRI 1 and Note 3 to Section XVI, the Qosmio is classified

in heading 8471, HTSUS. It is specifically provided for in subheading


8471.30.0000, HTSUS, which provides for: ‘‘Automatic data processing ma-chines and units thereof; magnetic or optical readers, machines for tran-scribing data onto data media in coded form and machines for processingsuch data, not elsewhere specified or included: Portable digital automaticdata processing machines, weighing not more than 10kg, consisting of atleast a central processing unit, a keyboard and a display.’’ The column one,general rate of duty is free.

EFFECT ON OTHER RULINGS:NY K88339, dated August 17, 2004, is hereby revoked.

MYLES B. HARMON,Director,



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